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Banking generously on the hopes of resolving unrest in the Niger Delta, attracting tens of billions in foreign investment and successfully reforming the oil sector, the Nigerian Oil Ministry says it is planning to increase crude oil output to 2.8 million barrels per day by 2019.
The rosy forecasts come from the Oil Ministry’s short-term policy paper, as reported by S&P Global Platts over the weekend.
Beyond this, the Oil Ministry’s policy paper calls for an increase in oil output to 3 million barrels per day by 2020—up from 2 million barrels per day presently.
In terms of gas output, the Ministry is targeting an increase from 2.5 billion cubic feet per day presently to 10 billion cubic feet per day by 2019.
All that is required to achieve this goal, for starters, is an end to the war on oil launched by Niger Delta militants, which have wreaked havoc on the oil sector in a renewed push to take pipelines and facilities offline and force the government to deal with the grievances of local communities over their share of the region’s oil wealth.
On Sunday, the Niger Delta Avengers vowed to renew attacks on oil facilities after the government failed to withdraw troops from the oil-producing region.
Additionally, the Ministry is hoping to lure in $100 billion in foreign investment, which again is contingent upon getting control of the militancy in the Niger Delta—investors don’t want to drop cash on oil facilities that could be shut down at any time by the Niger Delta Avengers, or any of the numerous other groups that have emerged in recent months.
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Potential reforms, however, could help attract more foreign investment. According to Platts, the Ministry is eyeing a complete overhaul of the sector, which will include “huge investment opportunities in infrastructure development” promising “healthy and diversified returns”.
Nigeria is planning a major overhaul of state-run NNPC, the Nigerian National Petroleum Company, hoping ultimately to list it on the stock exchange in the wake of accusations that its energy sector is riddled with corruption and mismanagement.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.